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Speaker 1: This is a Bloomberg Business Flash from Bloomberg World Headquarters.
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Speaker 1: dot Com. Now let's head over to the First Word
Speaker 1: Breaking news desk for today's afternoon call, and here is
Speaker 1: Bill Maloney. Good afternoon, Charlie. Big reversal today for you
Speaker 1: as stocks with the Dow currently higher by seventy three
Speaker 1: point scipes Game three and NAZAC falls a point at
Speaker 1: one point, the Dow is down a hundred and sixty
Speaker 1: nine points up of market School is lower despite his
Speaker 1: surge in the last hour of trade. Italy fell one
Speaker 1: percent and the U S small cap six hundred is
Speaker 1: down three points. The US tenniel at one point five
Speaker 1: six percent, held the key test of the February lows,
Speaker 1: and seven out of n SB sectors are higher, led
Speaker 1: by gains and telecom, utilities and consumer staples. Industrials and
Speaker 1: energy led to the downside. Down Transports fault six, Nazi,
Speaker 1: botexs lose six, and the vix is a little changed.
Speaker 1: Down Leaders included Mark three M and Microsoft, Nike and
Speaker 1: Boeing led to the downside. Look for Oral, Look for Oracle.
Speaker 1: Results after the bell estimates are four eighty two cents
Speaker 1: on revenues of ten point four seven billion. Live on
Speaker 1: the first Breaking news task on Bill Maloney, Charlie, all right,
Speaker 1: thank you to hear live breaking news over your Bloomberg
Speaker 1: type squawk s q U A w K on your terminal.
Speaker 1: I'm Charlie Palaton. That's a Bloomberg business flash. You're listening
Speaker 1: to taking start with Fox on Bloomberg Radio. It's the
Speaker 1: crown jewel of the Ford Motor Company. It's best selling model,
Speaker 1: certainly in the truck category, the Ford F one fifty.
Speaker 1: Our reporter John lipp It, though for Bloomberg News, has
Speaker 1: found in his story. He reported on for Bloomberg Today
Speaker 1: that some versions of the new F one fifty still
Speaker 1: don't meet the government's twenty sixteen admission and fuel economy mandates.
Speaker 1: And this is a problem because by those hurdles, those
Speaker 1: fuel mandates will become much more stringent. John, Welcome to
Speaker 1: taking stock and congratulations on a very interesting story. So
Speaker 1: what is it the heart of this? What kind of
Speaker 1: what kind of problems did you turn up and how
Speaker 1: did you do it? Well? I had the heart. It
Speaker 1: is just I guess if you took a poll, everybody
Speaker 1: would say I'm in a a favorite of clean air. But
Speaker 1: the question is was it take to get that? And
Speaker 1: so we're talking about the Crown Jewel. As you said,
Speaker 1: you know, the a half of for its North American
Speaker 1: profit is wrapped up in these big pickups. And big pickups.
Speaker 1: You know, they have four wheel drives, they have town capability,
Speaker 1: they have all this stuff, and plus are not very
Speaker 1: good aerodynamically. So it's just harder to move the needle
Speaker 1: on a big pick up than it is on a
Speaker 1: Ford Focus. So it's not and we've got to point out,
Speaker 1: I mean, it's not just Forward that's struggling, because it's
Speaker 1: everybody and um and and the government is you know,
Speaker 1: they're showing no signs of backing off. I mean Obama
Speaker 1: has has said fifty four point five miles from bawling
Speaker 1: as a as a corporate average, and that's where the
Speaker 1: government intends to go John, I just want to offer
Speaker 1: a statement from Ford because we contacted them, of course
Speaker 1: because of the story. Uh. They said that Bloomberg's F
Speaker 1: one fifty story is wrong. They said that Ford exceeds
Speaker 1: fuel economy standards and the F one fifty is a
Speaker 1: strong positive contributor to Ford's fuel economy compliance and say
Speaker 1: that the F one is also has best in class
Speaker 1: gasoline fuel economy customs, recognizing F one fifties best in
Speaker 1: class capability and fuel efficiency with strong and grow sales
Speaker 1: while major competitors are losing market share end quote. What
Speaker 1: is your response? Well, I think that I think that
Speaker 1: the forward, I mean we our headline said the fifty
Speaker 1: has a big problem, right and forward that that's the
Speaker 1: core of They're saying that that headline implies that the
Speaker 1: entire program is auto compliance now and so on and
Speaker 1: and and that's notw what're that's how the story says.
Speaker 1: So so when we use the word problem, we're saying, um,
Speaker 1: after having spent a lot of money in six years
Speaker 1: to redesign and put aluminum body for you know, a
Speaker 1: lot of technology, after having done all this, there the
Speaker 1: program as a whole complies UM. But as Kathleen said
Speaker 1: that in the intro, everything gets much harder. So right
Speaker 1: now a truck you know sort of average f one
Speaker 1: fifty is about twenty four miles again, requirement that goes
Speaker 1: to thirty three. And so I'd say they ran the
Speaker 1: Olympics um to get to this point, and now they've
Speaker 1: got to run the Olympics, you know, a bunch more
Speaker 1: times in order to keep up with where the government
Speaker 1: is taking these regulations. And of course um you cite
Speaker 1: a report by Barkley's analysts Brian Johnson, another piece of
Speaker 1: research from Gopaul Dooley from HD Systems. So is this
Speaker 1: I'm just curious if the information they got is something
Speaker 1: that's publicly available and it's you're saying four Just this
Speaker 1: kind of disputes how the problem is described or how
Speaker 1: the issue is described rather than saying it's wrong. And
Speaker 1: if that's the case, what do they say about saying no,
Speaker 1: we can meet these targets? Well, forward, yeah, Forward is
Speaker 1: saying that they will meet um um regulatory requirements. There
Speaker 1: you know, they're meeting them now and will continue to
Speaker 1: do so. And we when in the story, you know
Speaker 1: they've got hybrid pick up coming they're looking at diesel.
Speaker 1: They may even put a four cylinder in the F
Speaker 1: one fifty for the first time in the US. So
Speaker 1: I mean they've got a lot of uh technology that's coming.
Speaker 1: But it's not just I mean, I mean in a
Speaker 1: way for them to say we will meet the standard,
Speaker 1: it's it's um um, it's it's it's sort of true
Speaker 1: by definition because if you if you don't meet the
Speaker 1: admission standard, you can't sell the truck and then basically
Speaker 1: boards out of business. Sean, I just want to we
Speaker 1: only have a limited amount of time. I just want
Speaker 1: to get your thoughts here. Just could you explain to
Speaker 1: people in about thirty seconds what the methodology was that
Speaker 1: you used in order to come up with the details. Well,
Speaker 1: the methodology, I mean working with UMP to leave in
Speaker 1: others is just the targets around public by footprint on.
Speaker 1: You add up to targets and into U I mean,
Speaker 1: you add up to performance into a corporate average and
Speaker 1: it needs to see how it comes out. I mean,
Speaker 1: so the methodology is pretty straightforward. So in words to
Speaker 1: measuring the performance of the truck now against the standards
Speaker 1: as you have pissed now and then saying and what
Speaker 1: happens when the standard moves higher going forward. Thank you
Speaker 1: very much. John Lippert, automotive reporter for Bloomberg News, speaking
Speaker 1: about Ford Motor Company. It's f one FI shares of
Speaker 1: Ford up ten cents right now th eleven cents for Ford.
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